A Connecticut federal judge has ruled that it was wrong for an insurer to refuse to pay out a $10 million life insurance policy on a Hartford lawyer who died of brain cancer.
Principal National Life Insurance Co. issued a $10 million term life insurance policy to Larry Coassin on April 26, 2012. The policy was formally issued to the Lawrence P. Coassin Irrevocable Trust.
At the time, Coassin was a partner in the Hartford law firm of Robinson & Cole, where he had a successful corporate and transactional law practice. Coassin died only 15 months after the policy was issued from a rare, very aggressive form of brain cancer. He died within seven months of his diagnosis. He was survived by his wife, Emily, and their two children.
According to court documents, Principal conducted a “contestability review” of the life insurance policy issued to Coassin. This was Principal’s common practice whenever a policyholder died within two years of issuance of a policy.
As part of that review, Principal learned that Coassin had seen an ear, nose and throat specialist who treated his dizziness symptoms at a visit only nine days before they issued Coassin the life insurance policy. Principal did not know about this visit when they issued the policy.
Nathan Berns, a senior underwriter with Principal, determined in October 2013 that the insurer would not have issued the life insurance policy to Coassin, if Principal had known about his visit with the ear, nose and throat specialist. Berns consulted with lawyers before making the determination, according to court documents.
U.S. District Court Judge Janet Bond Arterton, seen here, agreed with the plaintiff. (Photo: law.com)
The next day, Principal filed a lawsuit in U.S. District Court in Connecticut, seeking to rescind the policy.
“As a result of Coassin’s knowing and material misrepresentations and/or omissions as to his medical history on the application, the policy is void ab initio and of no force or effect since its inception, and Principal Life never has nor ever could become liable for the death benefit under the policy,” wrote Principal’s lawyers in the complaint.
Coassin’s family learned of Principal’s decision and lawsuit and filed a counterclaim of their own, seeking to enforce the policy and force Principal, as provided in the policy, to make the $10 million payment to the trust.
Coassin had recurring bouts of vertigo, for which he sought treatment. The trustees argued that, had Principal known about the doctor’s visit in question, they would have inquired further about the condition but ultimately would have issued the policy.
“If Principal knew that Larry Coassin was going to die of a rare, aggressive brain cancer, of course it would not have issued the policy to Larry Coassin,” wrote the trustees’ lawyers in their counterclaim. “… It is important that not only did an ENT specialist, a neurologist and a radiologist conclude that Larry Coassin had no medical condition that required further investigation … but also neither Larry Coassin nor anyone around him had information to the contrary. Larry Coassin was an incredibly energetic, busy, physically active and intellectually active person.”
U.S. District Court Judge Janet Bond Arterton agreed with Coassin’s family.
“The Court concludes that Mr. Coassin’s knowing misrepresentations on his life insurance application were not material, and as such, the policy was not void ab initio and Principal did not have a right to rescind it,” Arterton concluded.
Arterton then ordered Principal to pay the trustees of Coassin’s policy the $10 million.
Lead attorney for Principal is South Florida-based lawyer Julie Cloney, who could not be reached for comment by press time. Coassin’s trustees were represented by David Schaefer, of Brenner, Saltzman & Wallman in New Haven. Schaefer did not respond to an interview request Wednesday.
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